The million-dollar student, Elliott Herrod-Taylor, founder of the-bunch
If you ask Elliott Herrod-Taylor, CEO and Founder of the-bunch, how old he is, his answer is going to be ‘I’m 24, okay, and I don’t have any corporate experience in property or anything.’
Luckily, neither of these factors seem to have stopped him building a multi-million-pound revenue business with his young co-founder partner Will Stewart.
Twenty-four years old and running an empire
We start the interview gently; we ask Elliott about his schooling? ‘I got excluded a few times from school. I was a little bit naughty. But my main thing actually growing up was rugby.’
The young man is being modest, he had played for Bath Academy since he was 13, then got a scholarship and bursary to go to Marlborough college, and spent his sixth form there, meeting his to be co-founder Will Stewart. He represented England at youth levels and at the end of school was offered a professional rugby contract with Bath, a golden future was already mapped out.
Rugby stardom was cruelly snatched away, three months in he was bitten on the knee by a fake widow spider which developed into sepsis and then a number of surgeries. Not one to not have a plan B, Elliott moved forward ‘ so when I got over the worst of it, I got into got into clearing on Leeds University, so it was a bit of a rollercoaster ride if I’m honest.’ Two weeks after getting out of hospital he was in Leeds freshers with a big bolted metal thing attached to his leg as he hopped around.
Adversity meets opportunity
We ask him if adversity was hard to take. Disarmingly honest Elliott said that it was good to have a break from the religious amount of rugby training, and it, ‘ it was quite nice to have a bit of a break and go mess around and meet loads of people. But then I’d always wanted to sort of run my own business.’ His parents had their own business which Elliott had been around since he was ten.
‘And I think I was always really good at rugby, and it was a great avenue for me to get into places like Marlborough college to meet new people. But I think there was always something else and once I had my year of freedom, I then started looking at opportunities and that’s really when I came up with ‘the-bunch’.
He explains that the forerunner of the-bunch was the catchy company name ‘ Easy Student Living’, ‘that stuck for two years.’ But having left University it was necessary to open up their market to non-students, ‘I came up with the-bunch, as it is really around the bunching of your bills, so we bunch it all together. Because that’s obviously part of the service, one bill for everything.
I noticed there was a problem
Intrigued it was time to dig deeper, so we asked how the company he founded and was now CEO of started; and like all great enterprises it started with a problem.
After his first year at University Elliott needed a student property let, ‘so I think the first time I really noticed that there was a problem was I just left halls and I was moving in with 10 friends into big house in Leeds, and it was somehow me that was sort of lumped with setting up all the bills. Yeah, and I set up all the energy and all the broadband and it was all in my name and then chasing housemates for money.’
‘And it just came a bit of a nightmare. Just so many issues, you weren’t there in the summer and big bills racking up and Just yet the whole thing came a bit of a nightmare I went, there’s got to be a better way of doing this. And I saw it, and noticed it in my own house, but also amongst those different people that I was friends with.’
‘People were leaving houses, and not paying, people being left with big debts. And I thought, actually, there’s a real problem here, not just in terms of the bill splitting element, but there’s a liability issue. And also, it caused quite a lot of arguments as well.’
‘And it’s especially when you’re at that sort of vulnerable age at university when you’re trying to still make friends and build relationships. The awkward question about money is actually quite difficult for a lot of people.’
‘That was really the idea and we basically built the bills out. We actually started off just selling broadband and internet Payment packages selling x-boxes and broadband together for three pounds a week.’
Over the next eight months they plodded on, with limited results before realising they needed to bunch together all the utilities, ‘and so that’s really where we bunched in all the packages. And then really once we got a bit of traction on that front, we got up to about 200 customers.’ By the end of the second year these 200 customers were generating over £170,000 of revenue.
Scaling up
Like so many Founders Elliott took a chance and decided to back himself, and took a year out from University and with two really close friends went for it. At the start of that time they had about 100 customers, mostly friends they had networked, but utilising sales techniques developed on a shoestring they pulled in more paying customers.
‘Jamie, who I work with, we also had an events business together. Yeah, we were throwing sort of student raves. And we started to learn the marketing techniques from that about how to attract students and how to get interest. And we started applying those guerrilla marketing techniques, because we didn’t have any money at the time.’
In answer to how the venture was financed it was bootstrapped, our rugby hero took out some personal loans until the revenue started to pour in.
Most of the company’s selling was face to face getting the brand and the message out to students, their biggest ally was ‘that we were students at the time as well. So you’re one of them … not some old school utility company’. By the time Elliott was in his final year the company had scaled to 1,800 customers and revenue was in his words a ‘seven-digit number’.
Asked why it took off, Elliott replies, ‘We were doing it for the right reasons. And I think that really made a big impact. I think even today, that does make a big impact because students are still our target market … we’ve all got brothers and sisters at university. We’ve got lots of friends.’
Tell us about the technology
Usually when we interview a founder of a company there is a familiar narrative, they or a close friend have been coding since they were three years old and they tell us with glee all the whistles and bells of their platform, or service.
Elliot Herrod-Taylor, not for the first time blows our minds, when he tells us that originally the-bunch was extremely low tech. That is right, not only did he dream up a new way to generate vast income, he did it on a virtually manual. non-digital, non-automated system. It was reliant until October 2019, on excel sheets, filing cabinets and lots of files and paper.
As Elliott, with a wide grin put it, ‘My Chairman David Murray-Hundley laughs and says, I think we’ve made the most money anyone’s ever made of an Access database.’
Sheepishly we ask what Access database is, Elliott is now in full swing, ‘So it was brought out in 1994, Microsoft Access, and it’s completely offline, so it doesn’t speak to anything. And it’s basically a nice way of storing data. And you can do a few internal calculations into it. But it’s got no SQL database, and a lot of the information is sort of stuck in there.’
By the time, their 1,800 customers hit 3,000, it was time to get some investment, so they could get the correct technology in place and equally as important to, ‘to really start to turn all the learnings that we’ve made over the last three years. So doing it manually is an absolute pain in the … But one thing that we did you do learn is you know, the model and how it works inside out.
So we basically use all of that learnings, and over the last sort of 10 months we’ve been bringing that all online, got a tech team in place now and we’ve also been using that to launch the new product that is coming out at the end of this month.’
Having experience of raising investment we ask Elliott if the lack of technology within the business made it tricky to get cash?
‘Yeah, so I think is an interesting one as well, because when we went for investment, that was the biggest thing. Well, where’s your tech?
We’d proven in the market; we’re bringing in over seven figures of revenue. And that was the thing. Well, where’s your tech? Where’s your tech.’ Unsurprisingly though they quickly found their investment.
With the investment came a more corporate style, a chairman, directors, and others with specialist technical and switching industry knowledge, including Clive Gilson in a non-executive director role, a person with masses of fintech expertise. ‘So what we’ve tried to build is a team that isn’t just there for an investment deck. And I think it’s really important point for me because I don’t see the value in trying to pay someone just to make us look good.’
Elliott also admits he finds the boardroom meetings still a little nerve wracking, but he has implicit trust in the governance of the Chairman and he sees the advantage of paying for expertise that will help the company grow, ‘The other thing as well as we’re still we still are bright eyed and it’s quite cool to be able to have in conversations with people who have achieved massive things in their career’
It is at this point you realise that the sky is the limit for the-bunch, because unlike many proptech companies who have multi-million pound angel investment followed by other rounds of funding, this team with an average age of 23 years, has been punching massively above its weight and now technology enabled the world title heavyweight in our eyes is definitely on.
Fearing to ask, we do; Elliott where are you with revenue now for this year? ‘Over the two mark’ a little stunned we assume this to be two million pounds and we move on with our questions.
What is the-bunch doing right now?
Elliott relaxes into his chair and we can not wait to hear what this young Elon Musk has up his sleeve, we do not have to wait long.
‘Yeah, so we’re focusing on a really a new product. So I will be the first to say that the bills was a great problem. And it is a real problem and it does add a lot of value, but it’s not enough. It’s not enough to one achieve the scale that we want to achieve. And I don’t think it’s enough value added to the both the tenant and the agent.’
Now we are interested, obviously the business model has moved on. It has, the-bunch will still be servicing its core objective, but it will do much more. As Elliott puts it, ‘I don’t think we’re focusing on the right, pain points for them. Over the last three years, we’ve built up a history, we understand that market, we’re not moving away from it. But there is a semi pivot and where we’re moving towards now. And that’s really around a platform to assist with the rental process.’
So from a purely switching model for utilities, clearly Elliott has loftier ambitions, ‘So we’ve built out quite a unique platform, we think we’ve tried to keep it cool and trendy. And basically, we are launching an interactive/gamified and fun housing platform where it will be the first app that all the tenants can collaborate together on.
So once you download it, you invite your housemates and the filtering is done, you will swipe the same houses and it starts to learn the preferences in the household. It is a way of collaborating and making it fun as a house.
Rather than one person looking, it is a fun way to collaborate together, improve, like build the excitement together, let’s swipe, and oh my god, I found this, did you like that one. And then it leaves comments about each property, all consolidated in the app. And then you can put viewings and make offers. And then, so the value is really for the tenant.’
‘So that’s what we’re pinpointing now. But then making sure that once they found the perfect house, there’s no worries at all about the utilities. They’re already set up in order for us Obviously for the agent, it’s the same, they build as a new revenue stream for them. And like that, but they make 60% of their money off letting the property. So again, we’re focusing on that pain.’
The service – a housing lifestyle app for tenants
On the day of his interview Elliott proudly tells us that it was the-bunch’s ‘biggest ever day of sales.’ They took out the new product out to market and got bagged nine agents signed up in one day, adding over 1,500 houses onto their platform, with another five agents likely to follow.
How does the-bunch introduce the app? ‘A free to list platform, a housing lifestyle app for tenants, where they find their property, then manage their bills.’ At the heart of the company’s strategy is that they want a platform that caters for the same client from undergraduate renter to when they buy their first home.
Elliott goes further, ‘ I think it’s about trust, it’s really around creating a relationship early doors, when a tenant is young, and they are looking for their first time and guiding them through that process. And then once they’ve once they’ve found the perfect house, we look after them, we do them a good deal on the energy we make sure that they are only liable. And then we repeat that process.’
Not wanting to upset Elliott we ask the big elephant in the room question, lettings agents, are they not suspicious of you, about how make your money. Do you have to explain it?
‘I’m quite blunt, it works up north. I can bore you with our ambitious plans about how we want to beat Rightmove, and we want to be the biggest student portal in the world. But quite frankly, it’s free to list, the minimum, the worst-case scenario, we’re going to pay you 20 pounds per house for switching. So you’re actually going to get paid to join. And we’re going to get you leads. And the best case is that we get you leads, we let your houses and you make even more money. They want leads, and a new revenue stream.’.
We ask our founder, so really what you’re saying to them is, if you adopt the system, you’re going to feed him with undergraduates? Is that correct? We’ll feed you the undergraduates, we will make money on bills.
Elliott smiles, ‘Basically, the pitch has really been bills are a problem, but it’s not the biggest problem. So let us help you solve the tenant find process. Let’s help us let those houses which is what you care about what your landlords care about what makes you the money.
And for us helping you out on that front, we’re going to take control of the bills, and that’s where we make our money.’
We ask for a demonstration of the process and learn that the-bunch attract students who are looking for property to come onto their system, once there they invite other students to use the app, which is cool gamified experience. Once the tenants swipe on to a target let, the agent gets the intel, and does the viewing.
If it is positive, tenants use the app to secure the room/house, and the letting agent does the usual referencing, once all is in order the tenant’s bills are automatically set up for when they move in, and using the Ap or the website they stay in control. Elliott agrees and adds,
‘So for clarity all the houses on the portal are listed as bills included. So they’re expecting to pay a certain price when they get to that viewing.’ And ‘ The agent is then signing them up doing the guarantors and the rentals, contracts for say, let’s say 100 pounds a week, and then they would sign up on the app, or they would get them to sign it up in the store to say, for a the-bunch bills package.’
We ask as Letting agents are not being charged a thing, in fact the-bunch help them let their properties for free and give them revenue, do they make revenue out of the students?
‘So one of the biggest issues that I had was if you’re moving into a property with four friends, and one of you doesn’t pay you’re all joint and severally liable. So you’re guarantor for both sets of rents and bills, we offer a unique package where you can pay us 10 pounds per person per month, and you will only ever pay your share of the bills and rent. So if one of your friends becomes not your friend you are covered.’ Students do not have to take this policy out.
Running a start up business against a backdrop of COVID-19
Well, how has the pandemic affected you as a company in terms of meeting up, have you been in the office? And do you have an office normally?
‘Yes, so we got an office on King Street, right in the city centre, Bristol. And there’s about 12 of us. And yes, so we’re still small enough that we can work remotely. And we’ve already implemented and we’re using quite a lot of different software platforms like slack or Google Hangouts. The integration just took a couple of weeks to get used to, like everyone in that situation, it was more just understanding people’s rhythm.’
There is a lot of noise about the mental health issues around WFH, how was it for the-bunch?
‘ I think the hardest thing that we found, and we had to spend quite a lot more time on was adjusting those working relationships for each person on the team. So based on different circumstances, and there’s obviously a mental health angle to that as well, which we all I think had, maybe half of the team were struggling with. So there was that angle and we’re trying to manage that. So apart from that, I was so proud of how the team coped during lockdown’.
Having interviewed many founders, I was interested to hear about productivity, and had separation of the team members cut down on achieving goals? Elliott beams at this point, ‘so one of our busiest months are April through to September, and they’ve been able to do pretty much everything remotely. We’ve got people Coming in a couple of days a week now, but they Yeah, we, in terms of the team, we managed to basically hold together. I was really proud, proud of them’
As the-bunch’s core consumer is the undergraduate and the huge uncertainty around University take up, where does that leave the company? Again Elliot is always going forward, maybe it is that rugby spirit, where he leads the team.
‘ In terms of like, effects on sales and where we are, I think it is definitely been harder to get students over the line. I think a lot of that has been clarity on when they’re going back, because it’s changing every week, pretty much. And it’s also it is not a consolidated national effort; it is dependent on the university. So that’s been tricky for the sales team, but I think we’re going to have a big rush at the end of September, when they actually forced to go back.’
The good news for the company is that enrolment numbers across the Universities now seems to be pushing above 95%. But, one vertical of students may take a hit, again I put it to Elliott.
‘ There’s obviously a few issues with international students, which is definitely a big market, but for where we’re focused on people that move into private accommodation, and most of the international students are staying in purpose-built halls in their first year.’
I ask if there are any big clouds on the uncertain pandemic skyline, Elliott always on the ball comes back with, ‘ Actually, the biggest interesting point for our market is not this summer because most students sign a property six months prior to the start date. I think we’re going to see an issue next summer.’ And summer 2021 is a long way off.
I then ask how the pandemic has changed Elliott’s work pattern in the role of founder.
‘I think I actually have been quite enjoying working from home because I’m usually travelling to two cities a week, and also endless meetings. And so I’ve actually really enjoyed the break.’ Has there been other benefits, more time saved, perhaps?
‘I would probably say it’s at least a day a week. It’s a lot of time, isn’t it? Yeah. If you think about it in terms of it more working hours. I’ve travelled up north a lot. So that’s a three-and-a-half-hour train journey to London, probably twice a week, twice a month. That’s at least two hours. And it’s not the time saved because especially as a founder, actually the saving is cost. We were spending about £1,500, to two grand a month on travel and hotels. Last month it was £60.’
Elliott goes on to say that people in the team get more sleep, more social time and save more money from losing the daily commute, but he does see the office as a really important thing. The craic is important especially for a young team, average age 23 years.
‘I am not going to lie; bills are quite Boring. Yeah, that’s why people pay us to do them. So from an operational standpoint, and from a sales standpoint, it’s about all being together and doing it together. If you are doing a few mundane tasks, it is better to be in a really fun environment, when you do sales at home in your bedroom, which you’ve been sleeping in it … can really get you quite down. And I think we could lose, some of the engagement and motivation of the team if we were to get rid of that.’
Are there plans for expansion?
With a huge uplift in revenue turnover I ask Elliott if the-bunch is hiring, his insightful answer is quite an eye-opener.
‘So we’ve had three roles filled in the last six weeks. And what’s been really, really interesting is one of the first questions that they’ve been saying to a couple of my colleagues who have been doing the hiring is, what’s the work from home situation like or how, like, I’d be happy to take a bit less if I could just have more days at home. Which is I thought was really interesting is actually maybe the cost of salaries will decrease.’
Does the founder, at the tender age of 24 see himself as an enlightened employers? And this is where you see the inner maturity and fast business mind, of Elliott at work. The same mindset that we have encountered when interviewing forty-year-old CEO’s and Founders who have already exited a number of successful businesses, he certainly has all the credentials to go far.
‘I think work has changed fundamentally forever. But I’m not even sure it’s a pandemic. I think probably it had already changed before, but the stay at home made them realise that actually, lots of people can work from home.
It’s changing perspectives, especially large PLCs where the old ways – you’re in there every day and you love this show. You’re working. And then they’ve been forced to work in a different way.’
Asked if he can give a concrete example in the-bunch, immediately Elliott says, ‘I’ve actually found as well that with the operations team, anyone doing operational task base work have been so much more efficient not working in the office. Because they don’t get distracted …more able to crack on with their own task.’
What is the-bunch’s core structure – flatline?
Intrigued, that our CEO has a strong position on the team, we ask what style of management exists? ominously Elliot tells us it is flatline. Then he explains the term,
‘We empower the team so that we’re paying them for a reason. Let’s try and get them to grow into a bigger role, take more responsibility. We don’t know, where, and when problems are arising and we’re just doing the best job we can do. So, pretty much every single person in the team is involved in like decision-making process. So it is s not a case of me coming in and dictating and going, right. This is what we’re doing.’
He is quick to point out of course there is a more rigid corporate structure, ‘But there are obviously limitations to that as well, when there’s some big things that need to be just done and done in the right way. We’re building in more structure now and to say like, this is what we this is what we want to achieve.
That is really what the board brought in. It’s a great way to manage people. And if they don’t, you got to help give them a structured training. If they don’t do it, then obviously, they’re probably not suited to doing that role.
Does Elliott have any advice for other successful start-ups?
‘Because we haven’t had heaps of money, we’ve hired on personality rather than experience. So found people that have got the energy, love the idea, and are committed and problem solvers, we don’t have people with 10 years’ worth of PLC structure. We’ve got people that are very keen and hungry and just problem solving. I think if you’ve got some radicals in your little bunch, that is going to be good because they’re going to come out with some really good things.
